Demand for the latest smattering of REIT (Real Estate Investment Trust) issues was deemed particularly strong last week, although market professionals do not expect the deal-flow to increase accordingly. At time of writing, factory outlet center Tanger Properties Ltd., was planning to price a $75 million seven-year bullet transaction via Merill Lynch. LNR Property Corp., had priced a sizeable increase of its outstanding 10.50% senior subordinated notes.
Proceeds of the Tanger deal will be used to repay $75 million of 8.75% senior unsecured notes due March 2001, the intention being to lengthen the borrower's debt maturity schedule and improve its financial flexibility. Demand skyrocketed as holders of the original bonds showed willing to participate in a new deal. Demand was even stronger for LNR's opportunistic add-on via Deutsche Banc Alex. Brown. What was originally billed as a $50 million deal had burgeoned to $135 million by the time it was priced.